45th legislature - STATE OF NEW MEXICO - first session, 2001

RELATING TO GOVERNMENT CONTRACTING; PROVIDING FOR CONTRACT MANAGEMENT AND ACCOUNTABILITY; REPEALING AND ENACTING SECTIONS OF THE NMSA 1978.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. CONTRACT DEVELOPMENT AND MANAGEMENT--DEPARTMENT OF FINANCE AND ADMINISTRATION DUTIES.--The department of finance and administration shall:

A. organize the necessary resources and expertise to assist executive agencies in quality contract development and management, including providing training courses;

B. develop policies and procedures for quality and performance accountability in contract management;

C. actively participate in the development of major requests for proposals and contract awards of executive agencies for competitive procurement over twenty thousand dollars ($20,000);

D. selectively monitor contract procedures and projects in executive agencies;

E. prepare guidelines for executive agencies conducting and documenting a meaningful cost-benefit analysis;

F. prepare guidelines for executive agencies on contract specifications, terms and conditions that include performance measures, accountability clauses, monitoring provisions and auditing;

G. prepare guidelines for executive agencies on contract documentation; and

H. track contracts of executive agencies and monitor executive agency monitoring and enforcement efforts.

Section 2. CONTRACT MANAGEMENT AND ACCOUNTABILITY--DETERMINING NEED.--

A. Prior to making the decision to contract for services, a state agency shall assess the need to contract, considering whether the agency has the necessary skills and expertise to deliver the service; whether the agency can provide the service at a competitive price; and whether there are deadline requirements that the agency may not be able to meet. As part of its assessment documentation, the agency shall specify if the contract is needed because it does not have the resources or expertise to perform the work or if the contract is a means to privatize state services.

B. Every decision to contract for services shall be accompanied by a cost-benefit analysis that uses a methodology similar to the federal office of management and budget's cost-benefit evaluation for the performance of commercial activities and that includes an objective evaluation of state and private resources.

C. The state agency's administrative services division, general counsel and secretary, or their equivalent personnel in non-cabinet state agencies, shall substantively review the decision to contract, the request for proposal process, final contract negotiations and contract form and legal sufficiency.

D. The legislative and judicial branches and state educational institutions may use the guidelines, policies and procedures prepared by the department of finance and administration or may develop their own guidelines, policies and procedures to ensure quality and performance accountability in contract development and management, including monitoring.

E. As used in this section and Section 3 of this act, "state agency" means a branch, department, institution, board, bureau, commission, district or committee of the state.

Section 3. CONTRACTS--SPECIFICATIONS, TERMS AND CONDITIONS--DOCUMENTATION.--

A. The following elements shall be included in all contracts for services:

(1) performance measures that will be used by the state agency to evaluate the services provided to the state agency;

(2) an accountability section that requires the contractor to meet the performance measures and that allows the state agency to recover damages for poor performance or to withhold payment until successful completion of all or part of a contract; and

(3) monitoring terms that will be included in the state agency's evaluation of the contractor's performance, including progress reports, activity data, site visits, inspections or outcomes.

B. The state agency shall use department of finance and administration guidelines or similar guidelines to identify and develop an effective documentation system for contract management, including:

(1) documentation to support the contract solicitation and selection process;

(2) policies and procedures to ensure that, except for emergency contracts, contractors do not provide services until a fully executed and approved contract is in place;

(3) cost-effective methods to track contracts; and

(4) filing of contracts and related documentation.

Section 4. REPEAL.--Section 13-1-118 NMSA 1978 (being Laws 1984, Chapter 65, Section 91) is repealed.

Section 5. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2001.